US Bancorp 3Q/99

Minneapolis-based U.S. Bancorp reported Thursday that average credit card loans for the third quarter remained flat at $4.0 billion. Compared to 3Q/98, the issuer’s outstandings actually dropped 1.6%. However fee income edged up 3.3% over the past twelve months, from $156.1 million for 3Q/98 to $161.3 million for 3Q/99. Meanwhile chargeoffs have continued to drop over the past year. For 3Q/99 U.S. Bancorp credit card chargeoffs came in at 3.50% compared to 4.69% for the previous quarter and 4.26% one year ago. For complete 3Q/99 financials for U.S. Bancorp visit CardData ([www.carddata.com][1]).

[1]: http://www.carddata.com

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Cap One 3Q/99

Capital One reported yesterday it added 1.6 million net new accounts during the third quarter, bringing total accounts to 20.8 million. Managed consumer loan balances increased by $657 million to $18.5 billion. Marketing investment decreased slightly in the third quarter to $175 million versus $178 million in the second quarter of 1999, and $126 million in the comparable period of the prior year. The managed delinquency rate (30+ days) increased to 5.06% as of Sept. 30, compared with 4.72% as of June 30. The managed net charge-off rate increased to 3.88% for the third quarter of 1999 compared with 3.73% in the second quarter of 1999. For complete 3Q/99 financials for Cap One visit CardData (www.carddata.com).

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Aria on LookSmart

Providian Financial announced yesterday that it has signed a one-year marketing agreement with LookSmart Ltd.. The agreement establishes the Internet directory and search engine as a primary online advertising channel for Providian’s leading Internet credit card, Aria VISA.

“Providian has partnered with LookSmart based on their proven track record and impressive Internet position,” said Greg Pacheco, Providian Senior Vice President and Aria business manager. “In earlier tests, the site has consistently generated a high volume of customers for us, and we are confident that LookSmart’s continued growth as a leading Web directory and search engine will be a great source of new customers for Aria.”

LookSmart is among the top 15 most-used Web properties, according to an August 1999 report by Media Metrix. It has 10 million unique users each month, making it an ideal site for advertising the Aria VISA, a unique credit card with broad customer appeal.

“We are very pleased to be working with a quality company like Providian,” said Brian J. Cowley, LookSmart’s Senior Vice President of Global Sales. “Considering the potential Aria has to meet the credit card needs of the broad consumer market visiting our site, this agreement represents a winning situation on three levels-for LookSmart, Providian and, most importantly, each of our customers.”

Providian launched Aria VISA ([http://www.aria.com][1]) in May of this year, complete with one of the lowest introductory APRs on the Web, an instant approval process that can take less than 20 seconds, online balance transfers and customer service, and one of the Internet’s most comprehensive rewards programs. Based on a customer’s profile, Aria determines which of its product offers will best satisfy a customer and delivers it with individualized terms.

About Providian Financial

San Francisco-based Providian Financial Corporation ([http://www.providian.com][2]) is a leading provider of lending and deposit products to customers nationwide and now offers credit cards in the United Kingdom. Providian serves a broad, diversified market with loan products that include credit cards, home equity loans, secured cards and membership services. With a commitment to 100% customer satisfaction, Providian’s mission is to help its customers build or rebuild, protect and responsibly use credit by providing a quality borrowing experience that leads to active and lasting customer relationships. The sixth largest bankcard issuer in the nation, Providian has $18 billion in assets under management and over 10 million customers.

About LookSmart

LookSmart, a leading Web directory and search service, creates and maintains one of the largest editorially reviewed directories of content on the World Wide Web. LookSmart’s directory is distributed through multiple channels, including a global network of ISPs, major Web sites, portals and viral marketing. Through its partnership with Cox Interactive Media, LookSmart also offers one of the largest collections of quality local Web content in more than 70 U.S. markets.

[1]: http://www.aria.com/
[2]: http://www.providian.com/

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Natl Geo MC

The National Geographic Society and First USA have entered into an affinity card agreement. The National Geographic/First USA MasterCard will be launched in January. Natl Geo says all net revenues it receives from affinity card program will be used for its core mission programs which include: conservation, exploration, research and education. Bank One, the parent company of First USA, was the exclusive corporate sponsor in 1999 of the National Geographic Bee, the Society’s nationwide geographic competition in which more than 5 million school students participate each year. National Geographic magazine, the official journal of the Society, is sent to nearly 10 million members each month.

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SunTrust Card Sale

Atlanta-based SunTrust Banks announced this morning the sale of its $1.5 billion bank credit card portfolio to MBNA. Under the agreement, MBNA will purchase the outstandings and will provide servicing for over 1.4 million accounts. The sale includes personal credit card outstanding balances from both SunTrust and Crestar Financial. Crestar was acquired by SunTrust last year. SunTrust estimates a pretax gain of approximately $300 million in the fourth quarter based on the expected outstandings as of Oct. 31. The business, corporate and purchasing card portfolios were not part of the sale and will continue to be maintained by SunTrust as will the merchant services line of business. SunTrust has also entered into an agent relationship with MBNA for personal credit card products.

SUNTRUST PORTFOLIO SNAPSHOT (3Q/99)

Receivables: $1,040,531,000 Quarterly Volume: $575,618,449
Accounts: 1,010,413 Actives: 556,354 Cards: 1,424,682

Source: CardData’s 3Q/99 Portfolio Survey

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Hypercom – Eurobank Deal

Eurobank confirmed it has contracted with Hypercom for 2,000 Hypercom ‘T7P’ card payment terminals. to Eurobank. This week’s agreement increases the total number of Hypercom card payment systems ordered by the Greek bank, during the last two years, to 6,000. Under terms of this week’s agreement Eurobank named Hypercom its electronic payments vendor-of-choice. Hypercom’s Greek partner is Sofianos Hellas.

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Gelco ExpenseLink

Gelco Information Network, the leading travel expense management company in North America, has helped its customers manage more than $2.5 billion in travel and expense transactions year-to-date through its ExpenseLink(R) expense reporting technologies.

“Gelco is often compared to travel and expense management companies that merely provide software, with no additional value-added benefits,” said Chuck Buckner, senior vice president and general manager of Gelco’s Expense Network. “The comparison is inaccurate. Software companies that don’t offer a full end-to-end solution can only measure their success on the amount of seats or software licenses sold. And since their clients implement and manage the technology themselves, the software providers can’t accurately determine if their clients are actually using the T&E product with any benefit. Gelco is completely different.”

“As a full-service Business Service Provider (BSP), we provide end-to-end solutions. We host the application; provide installation, deployment and support; implement upgrades without interfering with client business; and manage the processing with no additional IT infrastructure and internal MIS support. That means we can easily track the number of transactions that are being processed and exactly how our clients are benefiting from using our technology and services,” said Buckner.

Buckner added, “Without a doubt, Gelco deploys expense management technologies and processes transactions more quickly and efficiently than any other alternative. The users also receive prompt automatic reimbursements via direct payment to bank accounts within three banking days, and corporate cards are paid according to the company’s payment schedule. The implication of this is that our clients achieve significant cost savings.”

About ExpenseLink(R)

ExpenseLink is the only technology of its kind that offers automated expense report generation, approval and reimbursement, and an unparalleled enterprise data warehousing/datamining tool, while accommodating all platforms and levels of technology.

Through Gelco’s ExpenseLink/Web(R), a leading Internet application that provides enterprise clients with an end-to-end operational solution, users enter travel expenses online or offline and submit reports via a web browser or the Internet. Likewise, with Gelco’s ExpenseLink/PC(R) Windows-based expense reporting software, users enter business expenses offline, via a personal computer. ExpenseLink/TD(R), formerly Traveletter Direct(R), is Gelco’s phone-based expense reporting system. Through this technology, users dial a toll-free number; identify themselves; and enter the time period, expense report number and dollar amounts.

About Gelco Expense Network

The Gelco Expense Network is a resource that makes managing travel expenses easier. More than 1,500 corporations rely on Gelco’s multiple solutions — including Internet, PC, telephone and paper — to reduce the time and money associated with managing such expenses.

About Gelco Information Network

Through its Expense, Promotion, Government and International Networks, Minneapolis-based Gelco Information Network is the premier solution provider for managing corporate expenses of all types, and is recognized for making hard business expense processes easier. Across its four networks the company serves more than 2,000 U.S. and multinational companies, including hundreds of Fortune 1000 companies and more than 115 government agencies. Gelco maintains a 97 percent customer retention rate. For more information on Gelco, visit the company’s web site at http://www.gelco.com .

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Y2K Cash Horde

In spite of the fact that the number of adult Americans who are concerned that the Y2K bug will financially bite them has shrunk in the past six months, the number who plan to keep extra cash on-hand as a precaution is not declining. According to a just updated national consumer study from Brittain Associates, just over 31 million U.S. households are planning to stockpile some extra cash as a Y2K transition precaution. The same projection emerged from an initial study conducted by the firm last March. The new study also indicates that these households are not planning a mere “long weekend” cash buffer but rather an amount necessary to see them through several weeks if necessary.

“The good news is that consumers are hearing the financial community’s message about Y2K readiness, which is reducing the publics’ stated level of concern,” says Bruce Brittain, president of the Atlanta-based research firm. “Being ever-practical Americans, however, the number who plan to guard against any ATM system shut-downs and bank cash shortages remains at nearly one-third of all households.”

The updated study conducted September 8 – 12 revisited the financial concern issues first addressed by the research firm in March of this year. Each study involved over 1,000 telephone interviews with U.S. adults (18+).

Over one quarter of all checking account owners in the U.S. believe that there will be some Y2K related ATM problems. This level of concern is consistent with of the number of households who plan to stockpile extra cash, says Brittain.

Additionally, addressed investor concerns regarding Y2K related market declines and portfolio bookkeeping errors. Also investigated were the perceptions of possible credit card problems and issuer preparedness.

“About 30% of credit card owners foresee Y2K related card use problems,” says Brittain. “Together with those who fear ATM outages, it’s not surprising that these consumers want to have extra cash available.”

More descriptive details of the study and current study results can be accessed at the firm’s website: [www.brittainassociates.com][1].

[1]: http://www.brittainassociates.com/

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Smart ATM Modem

VA-based Transaction Network Services unveiled its newest family of smart modems, the ‘TransXpress 4000’ line, which is designed to support wireless, ISDN, dial-up and IP communications for ATMs. he new smart modem is designed to offer the maximum flexibility of communication options by adding expansion cards based on the customer’s requirements. The ‘TransXpress 4000′ will allow customers to add in wireless communication to the ATM, literally, overnight. To support customers’ growing desire to download graphics to their off premise ATMs, the new modem family will offer V.90 56k dial-up connectivity.

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Centurion Card

The widespread dilution to the perceived value of the ‘Platinum Card’ has given way to the introduction of the ‘Black Card’. American Express raised the stakes in the super elite market yesterday with the unveiling of ‘The Centurion Card’. The card is available by invitation-only to tenured American Express ‘Platinum Card’ holders. The new card carries an annual fee of $1,000 and offers a wide range of premium services geared toward the well-heeled frequent traveler. For example ‘Centurion’ cardholders qualify for free upgrades to the Concorde with the purchase of a full-fare first class transatlantic ticket on British Airways. Other benefits include complimentary upgrades on partner airlines and hotels, free access to some airline clubs, a personal travel concierge, personal shopper services and reduced fees for personal investment management. ‘Centurion’ cardholders also receive a 50% ‘Membership Rewards’ bonus on all charges made with ‘Centurion’ partners. Three years ago the AmEx ‘Platinum Card’ stood alone as the premier, invitation-only card with an annual fee of $300. Since then, major VISA and MasterCard issuers launched their own versions of ‘Platinum’ cards, mostly without annual fees and a limited number of premium services. As a result of the new competition, AmEx began, last year, to lower its qualifications for ‘Platinum’ cards by offering them to new cardholders. The AmEx ‘Platinum’ card also attracted new competition with the introduction of the ‘VISA Signature’ card and the ‘World MasterCard’. Both cards carry network level benefits geared toward the affluent, frequent traveler. VISA reported earlier this week that its ‘Signature’ card just passed the 500,000 card mark.

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PaySys Intl Execs

PaySys International, Inc. announced yesterday that Debra Wohlrab-Skinner and Matthew Leehun Lee have accepted the positions of Vice President of Operations, Americas and Regional Director of Asian Business Development, respectively.

Debra Wohlrab-Skinner, who most recently held the position of Vice President — Sr. Operations and Technology Officer, Latin American Region for MasterCard International, Inc., has spent her entire professional career in the financial services industry. Her extensive expertise in banking and financial services includes banking systems, electronic banking, credit and debit operations, project management, worldwide product management and technology analysis.

Prior to her thirteen years with MasterCard, Wohlrab-Skinner worked at Deluxe Data Systems, Applied Communications, Inc. and ADP. In her role as a Vice President of Operations, Americas, Wohlrab-Skinner will oversee PaySys’ operations in the company’s most developed markets, as well as global product management for the entire company.

Matthew Leehun Lee, former Vice President/Country Manager of China for Visa International, is joining PaySys as Regional Director of Asian Business Development after seventeen years with Visa International. Lee, who honed his industry knowledge at such companies as Wells Fargo Bank, Citibank/Citicorp, and Westinghouse Datascore before joining Visa, is a veteran of business development in the Asian region. His broad experience in the areas of software development, strategic planning, product marketing, and project management, as well as his multicultural team building expertise, will be key for the further development and expansion of PaySys’ Asian operations.

PaySys International, Inc. is the established leader in credit card management systems with its industry-defining VisionPLUS suite, which combines the banking and retailing capabilities of legendary company products, CardPac and VISION21. With headquarters in Atlanta, GA, PaySys has offices worldwide and clients in over 30 countries on 6 continents. For more information, please call +1-407-660-0343 or visit the company’s web site at [http://www.paysys.com][1].

[1]: http://www.paysys.com/

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Targeting Discover

After climbing to the ‘Platinum’ level earlier this year, Discover Financial Services is now targeting professional segments of the consumer market. This week Discover launched its ‘Platinum Professions Series’, according to CardWatch ([www.cardwatch.com][1]). Among the first in the series is the ‘Information Technology Discover Platinum’. The ‘IT Discover’ card offers a special $20 ‘Cashback Bonus’ award for the first purchase made at egghead.com and a 5% ‘Cashback Bonus’ award for every purchase made at beyond.com. The card also offers discounts and ‘Cashback Bonus’ awards for Ramada and participating merchants of Discover’s online ‘ShopCenter’. Card pricing is a 2.9% intro rate through April and a 12.99% fixed, go-to rate. Last month Discover launched the ‘Discover Educators Card’ which features a 5% ‘Cashback Bonus’ for purchases made at Zany Brainy stores.

[1]: http://www.cardwatch.com/

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